Wall Street edges higher after jobless, trade data

NEW YORK – Wall Street rose slightly on Thursday after stronger-than-expected U.S. job market data and a rise in exports a day after stock indexes posted the largest drops in months.

Data showed the U.S. trade deficit narrowed in September as exports increased, suggesting the economy expanded more than previously estimated in the third quarter.

A separate report said fewer Americans than expected filed new claims for unemployment benefits last week.

Qualcomm Inc , the leading supplier for chips for cellphones, rose 7.5 percent to $62.49 after it reported quarterly revenue that beat expectations late Wednesday.

Initial claims for state unemployment benefits dropped 8,000 to a seasonally adjusted 355,000, the Labor Department said. That was below the median forecast in a Reuters poll of 370,000.

An analyst from the department said Hurricane Sandy boosted claims in some states by leaving people out of work but also reduced claims in at least one state because power outages kept the state from collecting claim reports.

"We've seen a big spike in the trend of the jobs market in the past few months," said Adam Sarhan, chief executive of Sarhan Capital in New York. "We should react positively to this."

The U.S. trade deficit narrowed in September as exports increased, suggesting global demand for U.S. goods was holding up despite the debt crisis in Europe.

Equities slumped more than 2 percent Wednesday as investor focus returned to Europe's economic troubles and as the electoral victory by President Barack Obama turned markets' focus to the looming "fiscal cliff."

Investors worry that if no deal is agreed in Congress over some $600 billion in spending cuts and tax increases due to kick in early next year, it could derail the U.S. economic recovery.

"To the extent we start to see some clarification of what (Congress) is thinking about, whatever it may be, it will provide some confidence," said Rick Meckler, president of investment firm LibertyView Capital Management in Jersey City, New Jersey.

The European Central Bank held its main interest rate at 0.75 percent despite dovish comments Wednesday from ECB President Mario Draghi that stirred market rumors of a rate cut. A rise in the U.S. dollar also weighed on equities Wednesday.

Equities will continue to be pressured by Europe. The euro zone economy shows little sign of recovering before the year-end despite an easing of financial market conditions, Draghi said.